In the era of carbon neutrality, can methanol fuel cells make a comeback?

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In the era of carbon neutrality, can methanol fuel cells make a comeback? Author/Source: Titan Media Deep Dive Date: October 31, 2022 Click-through rate: 15. In 2006, George Olah, a Nobel laureate in Chemistry and renowned organic chemist, wrote a book titled “Beyond the Oil and Gas Era – The Methanol Economy”. In the book, George puts forward a new concept for solving energy problems in light of the global energy crisis: the methanol economy. He mentioned that in the future, after oil and gas, methanol will be humanity’s fuel. In general, coal, natural gas, oil, electricity, etc. can all be used to produce methanol; it is currently the fuel product with the richest variety of production raw materials available to humanity. “Methanol is inexhaustible; it is an energy carrier. ”Liu Ke, Dean of the Institute for Clean Energy at Southern University of Science and Technology and foreign member of the Australian Academy of Engineering**, once commented on methanol in a public setting. In addition to being virtually inexhaustible, methanol is also recognized internationally as a clean fuel: it burns easily, and the main by-products of its combustion are carbon dioxide and water; moreover, carbon dioxide can be used to produce methanol again, making it a low-carbon fuel that enables a true carbon-neutral cycle. As the world’s largest producer and consumer of methanol, data shows that in the first half of 2022, China’s methanol production amounted to approximately 38.35 million tons, representing a 2.43% increase compared to the same period last year. In September 2020, China officially proposed at the 75th United Nations General Assembly the goal of reaching carbon peak by 2030 and achieving carbon neutrality by 2060. The broader context of the times has brought methanol back into people’s attention. Although methanol has yet to be incorporated into the **energy system, efforts to develop green methanol are gaining momentum. The automotive industry has thus become an excellent testing ground for methanol in helping achieve carbon neutrality. “In the next step, efforts will be intensified in areas such as promoting methanol-powered vehicles, supporting the development of the methanol vehicle industry, and exploring new models for green methanol vehicles, in order to foster the growth of the methanol economy. The promotion of methanol-powered vehicles will be accelerated, and pilot regions such as Jinzhong City will be supported to take measures suited to local conditions, thereby further speeding up the adoption of methanol-powered passenger vehicles as well as commercial vehicles such as methanol-powered trucks. ”Recently, the Ministry of Industry and Information Technology stated this in its response to Proposal No. 2276 from the fifth session of the 13th National People’s Congress. For a moment, there was doubt about “Are methanol-powered cars reliable?” Can methanol fuel cells take this opportunity to achieve rapid development? ”There are various opinions. “**Methanol fuel cells have been explicitly included in the hydrogen energy plan, and combined with current policies regarding methanol-powered vehicles, this will drive rapid development of the industry related to methanol vehicles and methanol fuel cells. ”Zhou Qingzhe, partner at Yuanhang Capital, told the Titan Media App. Of course, some people believe that methanol-powered vehicles are not the main direction for future automotive development; the technology is still in the early stages of industrialization, and in the short term, the market is largely driven by speculative sentiment. Questions and discussions are entirely justified, as methanol fuel cells are not something new; for a long time they have not been recognized by the mainstream and have only served as a \"backup\" option. After many years, methanol fuel cells have once again come to the forefront. What exactly has happened to them? Amidst the calls for carbon neutrality, can methanol fuel cells truly shoulder this important responsibility? Initially, she was merely a backup player. In 1999, an important event took place in Chinese sports: at the Women’s World Cup, Sun Wen led her team to the final. Upon identifying this trending topic, Nanfu Batteries quickly signed Sun Wen as their spokesperson and aired advertisements during CCTV’s prime time slots. In the same year, the Dalian Institute of Chemical Physics and Anhui Tiancheng Electrical Appliance Co., Ltd. established a direct methanol fuel cell joint laboratory, where research was carried out on key materials for DMFCs and their manufacturing techniques, and some progress was achieved. The two parties’ collaboration began two years later, in 2001, when the Joint Direct Methanol Laboratory signed a four-year R&D cooperation agreement with Nanfu Battery. The aim was to develop small-sized mobile power sources; the total value of the contract amounted to 10 million RMB. At that time, South Galaxy Batteries had already secured the top position in terms of market share for alkaline batteries in China. One of the reasons it chose to collaborate with the Dalian Institute of Chemical Physics on the development of methanol fuel cells was this: a company named Manhattan Scientifics, located on the other side of the ocean, registered the trademark “Micro-Fuel Cell” with the intention of producing miniature direct methanol fuel cells for use as power sources in mobile phones. Phones powered by such batteries could remain on standby for six months and support continuous calls for a full week. This sends a signal that methanol fuel cells have begun to be used in communication products such as mobile phones. Furthermore, like all batteries, methanol fuel cells can be used not only in mobile phones but also in portable electronic devices that require power, such as laptops and cameras. In 2004, Sun Gongquan’s team at the Dalian Institute of Chemical Physics successfully developed \"the first set of prototype direct methanol fuel cells for laptops in China.\" Sun Gongquan returned from the United States in 2001. As a distinguished talent, he was hired by the Dalian Institute of Chemical Physics and joined the team led by Academician Yi Baolian to conduct research on methanol fuel cells. Methanol fuel cells have notable advantages in their application to portable electronic devices; however, they also possess inherent drawbacks that cannot be avoided. For example, methanol is flammable, and in many situations it’s not allowed to be carried, which more or less causes some inconvenience in its use. As a result, methanol fuel cells appeared for only a short time before quickly fading from people’s attention. The failure in portable electronic devices does not mean the complete downfall of methanol fuel cells. Another company, also from across the ocean, has found a longer runway. In 1997, German automaker Mercedes-Benz proposed a concept for a methanol-reformed fuel cell Class A sedan. In November 2001, DaimlerChrysler unveiled the methanol-fueled fuel cell vehicle NeCar 5 in Berlin. It was positioned as the world’s first methanol-reformed fuel cell vehicle to reach the trial phase. The following year, in order to systematically test the technical limits of the NeCar 5 under normal operating conditions, the Mercedes-Benz NeCar 5 set off from San Francisco, USA. After traversing hot California, the cold and snowy Sierra Nevada and Rocky Mountains, as well as mountain passes at an altitude of 2,640 meters, it finally reached Washington after 14 days, despite having to navigate through heavily congested major cities. This journey established a record for methanol fuel cell vehicles by covering a distance of 5,250 kilometers. Honda, another automaker equally committed to research and development, also conducted studies on hydrogen production via methanol reforming between 1996 and 2004, and introduced corresponding vehicle models. However, due to various constraints, research and development in hydrogen production via methanol reforming entered a downturn; few automobile companies launched related products. Only in certain specific areas did people begin to use hydrogen produced by methanol reforming as a backup power source. Two pathways: Over the nearly ten years starting from the late 1990s, methanol fuel cells made some progress in research, development, and application; there were promising signs, but they failed to gain widespread adoption. During this period, China showed little interest in methanol-powered vehicles as well; only a few companies engaged in research and development in this area. It was not until the introduction of policies supporting new energy sources in 2009 that the industry entered a phase of exploration and pilot projects. Simply put, on the path toward new energy adoption, the automotive industry can be divided into two main pathways: one pathway aims at phasing out internal combustion engines; this includes approaches that advocate for all-electric technology, fuel cell technology, and hybrid technology. Another approach is to continue using internal combustion engines while seeking alternative fuels, such as natural gas, methanol, ethanol, dimethyl ether, etc. In 2005, Geely stubbornly chose the second path—namely, replacing traditional internal combustion engines with methanol-fueled engines—and began researching and developing methanol-powered vehicles. The development of new energy vehicles depends on policy support. In 2009, Li Shufu, who was a member of the National Committee of the Chinese People’s Political Consultative Conference, submitted a proposal titled \"On the Urgent Formulation of Standards for Methanol-powered Vehicles,\" calling on the National Development and Reform Commission, the Ministry of Industry and Information Technology, and the Standardization Administration Committee to complete the development of standards for such vehicles as soon as possible. Soon, there was a response to this proposal. In the same year, relevant departments of the Ministry of Industry and Information Technology mobilized experts from the automotive and internal combustion engine industries to conduct research on methanol as a fuel for vehicles. Through market research and preliminary evaluations, the issues associated with the use of methanol as a vehicle fuel were thoroughly analyzed. Taking into account the characteristics of methanol fuel, in 2012 the Ministry of Industry and Information Technology, in collaboration with relevant ministries, launched pilot projects for methanol-powered vehicles in 10 cities across 5 provinces, including Shanxi, Shaanxi, Shanghai, Gansu, and Guizhou. Similar to Geely’s approach, the focus of policy at that time was to pursue a technical route based on \"internal combustion engines using methanol as a substitute fuel,\" rather than opting for a \"methanol fuel cell system that eliminates internal combustion engines.\" During the same period in China’s new energy vehicle market, electric vehicles began to move beyond the development stage and enter a phase of growth. In particular, in 2014, the first batch of Model S owners in China received their “car keys” from Tesla CEO Elon Musk. This marked Tesla’s official entry into the Chinese market, and it also accelerated the development of intelligent electric vehicles in China. Both paths moved forward simultaneously, but as shown by subsequent practice, the approach of abandoning internal combustion engines is clearly superior. Therefore, **the focus of support from relevant authorities has also shifted to electric vehicles, with little policy support for research on methanol applications. There are no positive policy developments, and the capital market pays limited attention to it as well. In 2010, Ouyang Xun, who gave up his prestigious U.S. green card, sold his house and returned to China with his family. He founded HydrogenPure Energy, a company that focuses on the development of fuel cell stacks and key components for hydrogen production from methanol. It was not until the fourth year after the company’s establishment that HydrogenPure Energy received its first round of investment, amounting to over 10 million yuan. The industry is in a state of chaos, and external support is limited, but this has not dissuaded Geely Auto from its perseverance. In 2017 and 2019, during the national ** periods, Li Shufu submitted proposals on two occasions, calling for policy attention to be paid to the issues related to methanol-powered vehicles. In March 2019, the Ministry of Industry and Information Technology, together with eight other ministries including the National Development and Reform Commission, the Ministry of Science and Technology, and the Ministry of Public Security, issued the \"Guiding Opinions on the Deployment of Methanol-powered Vehicles in Certain Areas,\" signaling that methanol-powered vehicles in China were entering a new stage of development, moving beyond the phase of exploration and pilot projects. Driven by policies, Geely Automobile is no longer a “lone warrior” in the field of methanol-powered vehicles. In 2019, AITO invested in Blue World Technologies, a Danish developer of methanol fuel cell systems. In August 2020, Aiways’ methanol reforming hydrogen production fuel cell project broke ground in Gaoping, Shanxi. Subsequently, a strategic cooperation agreement on methanol fuel cells was also signed with the Dalian Institute of Chemical Physics, Chinese Academy of Sciences. Unlike Geely’s approach with methanol engines, a methanol reformation fuel cell first generates hydrogen from methanol, and then converts the chemical energy of this hydrogen into electrical energy to power the vehicle; it can be understood as a battery consisting of a methanol reformation system and a hydrogen fuel cell. This approach is more costly and involves more complex equipment, but it offers higher energy efficiency. In 2021, the Ministry of Ecology and Environment officially opened the portal for submitting applications; methanol-powered vehicles manufactured by companies such as Geely that met the National VI emission standards began to be launched on the market, signaling that methanol vehicles had officially entered the stage of market promotion. A shortcut or a detour? “Methanol is a clean oxygen-containing liquid fuel that is easy to store and handle, abundant in supply, and has a wide range of applications. Green methanol is recognized worldwide as the essential pathway to achieving carbon neutrality. ”Li Shufu spoke at length about the advantages of methanol-powered vehicles at the Taiyuan Energy Low-Carbon Development Forum held in September 2021. However, if we start counting from 2012 when the Ministry of Industry and Information Technology launched a pilot program in five provinces and ten cities, it has been ten years since the promotion of methanol-powered vehicles began. Yet one obvious problem remains: to date, the total number of such vehicles nationwide is only around 30,000. Apart from Geely and AITO Motors, only a few companies such as Yuanlong New Energy Commercial Vehicles, Yutong Bus, and FAW have disclosed information regarding their product developments. On July 20, Haima Motors stated on the investor interaction platform that its hydrogen-powered vehicles are under development, and the company does not rule out exploring the route of producing hydrogen from methanol; however, overall, there are not many car manufacturers in the market that promote methanol-based products. At the 3rd International Hydrogen Energy and Fuel Cell Vehicle Conference held in Rugao in 2018, WM Motor showcased a electric concept car powered by a methanol fuel cell. However, there has been no further news regarding this project since then. Why give up halfway? Internal employees of WM Motor have said in interviews with the media that the reason for no substantial technical implementation plans later on was due to factors such as market promotion. In March of this year, Hengjiu Technology also mentioned in responses to investors’ questions on interactive platforms that the development of direct methanol fuel cells by its subsidiary Ogawa has reached the commercialization stage. These fuel cells have been used and tested in household passenger vehicles and logistics trucks, with satisfactory results, but automakers have not adopted them due to cost considerations. Why is the cost-performance ratio low? According to the TiMedia App, the key issue is that methanol has not yet been incorporated into the official energy system. This means that there is a lack of policy support for the production, sales of methanol fuel, as well as for the approval and construction of filling stations, which is why methanol filling stations have not been widely established in many areas of the country. “Since the “bridge” hasn’t been built yet, the car factory naturally doesn’t dare to invest large sums of money. Wei Anli, secretary-general of the Expert Advisory Committee for the Promotion and Application of methanol vehicles under the Ministry of Industry and Information Technology, said in a media interview that on the one hand, these automobile manufacturers, out of economic considerations, see limited returns from methanol vehicles for the time being ； On the other hand, the current infrastructure for methanol filling stations is inadequate, so sales of methanol-powered vehicles will not be very good either. On the consumer side, “given that the level of public awareness regarding methanol vehicles lags far behind that of battery electric vehicles, consumers know very little about them and naturally adopt a wait-and-see attitude.” ”A worker from an automobile factory told the Ti Media app. Despite the numerous challenges, Zhou Qingzhe still believes that, from the perspective of energy carriers, it is too early to conclude that the methanol technology route is not the main direction for the development of future vehicles. Of course, he also admitted that \"methanol fuel cells are still in their infancy at present, with few available options; most of them are still in the demonstration project stage.\" The development of the supply chain, as well as the maturity of fuel cells and engines, still needs to be improved. ”However, he also said that although the methanol approach involves some carbon emissions, it can make full use of the existing fossil fuel supply chains for storage and transportation, resulting in very low overall social costs. There is also a viewpoint that in evaluating the methanol economy, it is necessary to first identify the starting point. “In the traditional chemical industry, methanol represents a mature market. In the energy sector, methanol represents an emerging market, analyzed Huang Weiguang, deputy director of the Shanghai Advanced Institute of the Chinese Academy of Sciences, at the 2022 Taiyuan Energy Low-Carbon Development Forum. He believes that, from the perspective of this emerging energy market, widespread use of methanol as a clean fuel could lead to explosive growth. Data shows that in the first half of 2022, the apparent demand for methanol reached 44.2572 million tons, an increase of 2.83% compared to the same period last year. However, in the early stages of development, the specific path taken by any technology is tortuous and circuitous. The appeal of mature technologies lies in the fact that they have withstood the test of time. ““Currently, methanol-powered vehicles and methanol fuel cells are in a similar development stage to lithium batteries in the automotive industry 10 years ago,” said Zhou Qingzhe. At this stage, \"the technical approach is still in the exploratory phase, and at the same time, the industry and **relevant departments do not yet have as deep an understanding of methanol as an energy carrier as they do regarding the pure hydrogen approach.\" Therefore, \"**policy and guidance are extremely important.\" ”